The FBI accosted an independent research analyst on the porch of
his house at the end of October and threatened to arrest him if
he didn't wear a wire and try to trap a trader at SAC.

The analyst, John Kinnucan, held his ground, refusing to
help. He then sent an email to all his clients, which
included SAC, Jennison, Wellington, MFS, Citadel, and Maverick,
explaining what had happened:

"Today two fresh faced eager beavers from the FBI showed up
unannounced (obviously) on my doorstep thoroughly convinced that
my clients have been trading on copious inside information," the
email said. "(They obviously have been recording my cell phone
conversations for quite some time, with what motivation I have no
idea.) We obviously beg to differ, so have therefore declined the
young gentleman's gracious offer to wear a wire and therefore
ensnare you in their devious web."

Like a handful of other institutions, SAC has long has amazing
information about the companies whose stocks it trades, and this
information has helped it coin money for better than a
decade.

The investigation of another hedge fund, Galleon, has already
brought down one of Wall Street's most famous investors (Raj
Rajaratnam, who is fighting the charges). The Galleon
investigation has resulted in guilty pleas from 14 people, at
least one of whom was "flipped" by one of the FBI agents who
visited John Kinnucan in October.